The CEO of Vote Leave, Matthew Elliot, produced a huge 1000 page tome in 2015 while working for the pro-Brexit lobby group Change or Go. It was a considerable work with a lot of contributors and I tend to think of it as the Leave campaign's bible. Masochists among you can see it HERE. At the end (page 944) there was a helpful Q & A section and now, two years on, with the vote in the bag and negotiations underway, we can look back on what was said and compare it with reality. There is quite a difference in many cases.
Q30: How much tax would I pay after leaving the EU?
The outlook for trade and the current account is affected by the fall in the pound, a weaker outlook for domestic demand and the slowdown in import and export growth likely as we move to new trade regimes with the EU and other countries.
Mr Elliot's Answer: Probably less. As Section 31 shows, there would be significant savings from leaving the EU – not least when it comes to VAT. However, this would be a matter for the UK Parliament. Money recouped could alternatively be spent elsewhere, such as on public services or cutting the deficit.
What is actually happening?
From a speaking note (HERE) by the widely respected Robert Chote from the OBR presenting the Autumn statement in November 2016, the first public review of our finances following the vote to leave the EU:
The budget balance is weaker every year than we forecast in March and we no longer return to surplus by the end of the Parliament. We now forecast a deficit of £68.2 billion this year, up from £55.5 billion. And we forecast a deficit of £20.7 billion in 2020-21, compared to a surplus of £11 billion.
The "significant saving" from leaving the EU is actually a cost of £31.7 billion in the OBR forecast. This is approximately equivalent to the total raised by Council tax in 2016 according to the IFS HERE. In other words the answer to the question above should have been:
A: Your Council tax will need to double to make up the shortfall in government revenues caused by Brexit.
A: Your Council tax will need to double to make up the shortfall in government revenues caused by Brexit.
